Kansas City Real Estate Ranked #5

I received an email from Lisa Kanter over at Re/Max in Leawood with the following;

Daily Real Estate News  |  April 10, 2008Top 10 Best Cities for Home Sellers

Four factors are widely seen as affecting whether a housing market is a good one for sellers: job growth, amount of new construction, vacancy rates, and credit availability.

Forbes magazine used a variety of resources to determine how the country’s 40 largest metro areas fared according to these measures. The result is this list of top 10 cities for sellers:

  1. San Jose, Calif. Because of a tough regulatory environment, new home construction dropped 63 percent last year.
  2. San Francisco. When the conforming loan limit recently jumped from $417,000 to the maximum $729,750, that made credit much easier to get for many of the city’s home buyers.
  3. Salt Lake City. The 3 percent annual job growth rate, paired with a declining inventory of existing homes and one of the nation’s sharpest declines in construction made this market a good one for sellers.
  4. Austin, Texas. Texas is very affordable, plus the city has the nation’s fastest job growth at 4.1 percent.
  5. Kansas City, Mo. The number of unsold, vacant houses dropped by 40 percent last year.
  6. San Antonio, Texas. Jobs are growing by 3 percent and construction starts have dropped by 42 percent.
  7. Denver. The 49 percent drop in construction starts paired with the 2 percent rise in new jobs are good news for sellers.
  8. Providence, R.I. Vacancy rates at 1.6 percent combined with a 42 percent cut in inventory help sellers.
  9. Charlotte, N.C. Moderate prices and strong job growth bode well for sellers.
  10. Seattle, Wash. Strong job growth and a 42 percent decrease in new home construction are good news for sellers.

Source: Forbes, Matt Woolsey (04/07/08)

3 Comments

Filed under Kansas City Real Estate

3 responses to “Kansas City Real Estate Ranked #5

  1. Another Investor

    Remind me to stop reading Forbes magazine.

    The reason that new construction dropped 63 percent in San Jose is not the tough regulatory environment. The regulatory environment in 2008 is the same as it was in 2007 and 2006. The reason is that the builders could not find anyone else willing to buy a high density, 2 bedroom, 1,000 square-foot condo for $599,000. I don’t know how many single family permits were pulled, but it wasn’t many. Most sfr projects are in-fill, big boxes on tiny lots.

    The writer didn’t bother to talk to a mortgage lender before speculating about San Francisco, either. Rates for loans between $417,000 and $729,750 have not dropped much, if at all, by becoming “conforming.” Qualification standards are much higher and credit is much tighter.

    Prices are dropping in both markets.

    What is intriguing is the writer’s statement about absorption in Kansas City. If the statement is correct, that’s a staggering change in the market. Can you shed some light on this, Chris?

  2. Alot of people are sayign that now might not be the best time to invest in real estate, but I think the market in about to turn around big time for investors. Any thoughts?

  3. Regarding the Forbes article I posted it here for this very reason. Numbers can tell you anything you want them to.

    First is Kansas City really KC or is the entire area? That 40% drop number made my jaw drop and I had the same questions.

    I have read recently that KC’s job growth numbers are way ahead of some areas around the country. Even this is hard to believe when many people I know, including my wife, have had their businesses come in and shut down their divisions within the last few months.

    My dad lives in Charlotte that was highlighted for it’s job growth and he says it feels stagnant there, too. So who knows.

    As far as is it a good time for real estate investing? I think the answer is yes with the following rules;

    – you have to know your numbers
    – the house has to pay for itself based on the fundamentals.

    With inflation coming up (1.1% in March alone) as energy and food costs soar you are going to want to have some hard assets that help to hedge you against the inflation train. But you cannot get caught up in real estate speculation. It must be investment based on fundatmentals.

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